According to the new research from Lloyds TBS, the average deposit put down by home owners in the UK in 2013 was £70,540, just 6% higher than a decade ago as as shown on this September 2nd, 2013 article by the Property Wire.
The research report says that the average age of a home mover is 40
and affordability for second steppers, that is those moving to their
second home, has improved over the last year but fallen over the last
decade.
The research also shows that since 2008, the average price
paid by a home mover has fallen by 10% from £235,078 to £212,586 in
2013. Nationally, home mover property prices grew by 3% in the past
year.
Not surprisingly home movers in London, where prices have been rising
faster than in the rest of the country, put down the largest average
deposit at £126,528 or 34% of the average property value. This is close
to three and half times the average deposit put down by home movers in
Northern Ireland at £36,912 and the lowest in the country.
The average mortgage advance for a new home mover is £142,046, a quarter higher than a decade ago when it was £101,472.
With
the average age of a home mover now at 40 years old, this has increased
three years since 2002 when it was 37 in 2002. Most of the increase in
buyer age has occurred since 2007.
Typical mortgage payments for a
home mover, that is those already in the housing market, stood at 31%
average gross disposable earnings in the second quarter of 2013. This
has come down sharply from an all time peak of 52% in 2007. This
improvement has been due to a reduction in both mortgage rates and house
prices.
Housing affordability for second steppers, calculated as
the average price of a typical second stepper home less their current
equity position, stood at 4.4 times gross annual average earnings in
June 2013 compared with a ratio of 4.9 in June 2012.
A typical second
stepper's current equity position accounts for 13% or £21,200 of the
price of an average second stepper home, a rise from 1% in 2012.
Although the position has improved for those looking to put down a
deposit on a new home, for some potential second home movers this may
still not be sufficient to put towards a deposit when also taking the
cost of moving into account.
‘Housing affordability for the
typical second stepper has improved in the past year.
Nonetheless, there
are many potential second steppers who are still in their first home
which they bought in the run up to and at the peak in house prices in
2007. Many of these home owners may still be unable to move due to
having either very low, or negative, equity in their homes,’ explained
Nitesh Patel, housing economist at Lloyds TSB.
‘The lack of equity
for many home owners in their existing home largely explains why the
number of home movers in the first six months of 2013 was broadly
unchanged compared with a year earlier in sharp contrast to the number
of first time buyers growing by close to 20% over the period,’ Patel
added.
The report also reveals a considerable variation in housing
affordability between regions, with northern regions more affordable
than southern regions for second steppers. This is largely a reflection
of the lower prices for second stepper properties in the north. The West
Midlands and East Midlands both at 3.1, are the most affordable regions
for those in their first home looking to take their next step on the
property ladder. While London at 5.7, the South West at 4.6 and the
East at 4.5 are the least affordable.
Article Source: http://www.propertywire.com/news/europe/uk-property-deposits-afford-201309028183.html
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